Introduction to Temporary GST Identity
The Central Board of Indirect Taxes and Customs (CBIC) has introduced a noteworthy provision under GST for businesses not liable for registration. A new notification enables tax officers to issue a Temporary Identification Number (TIN) to such entities for specific payment requirements under GST, simplifying compliance and ensuring clarity for occasional taxpayers.
Key Highlights of the Notification
1. Temporary Identification Number (TIN) for Non-Registered Businesses
- Tax officers can now issue TINs to businesses or individuals who are not mandatorily required to register under GST, but still need to make payments under the Act.
- The TIN is issued using Part B of FORM GST REG-12, ensuring the streamlined processing of tax obligations for occasional payers.
- Part A of FORM GST REG-12, however, remains exclusive for issuing temporary IDs to businesses that must register due to turnover thresholds.
2. GST Registration Thresholds
- GST registration is mandatory for businesses with turnover exceeding the thresholds below:
- ₹40 lakh or more for goods (regular states).
- ₹20 lakh or more for services.
- ₹10 lakh or more for special category states, including Manipur, Mizoram, and Meghalaya.
- Special considerations: Jammu & Kashmir and Assam opted for a
- ₹40 lakh threshold, while Puducherry has a ₹20 lakh limit for goods.
3. Simplifying Compliance for 1.49 Crore GST Taxpayers
With over 1.49 crore registered taxpayers under GST, this provision ensures smoother compliance for entities not typically falling under the ambit of mandatory registration.
Waiver of Late Fees for GSTR-9 and GSTR-9C
1. Overview of Waiver
- CBIC has waived excess late fees for delayed filing of GSTR-9 (Annual Return) and GSTR-9C (Reconciliation Statement) for financial years 2017-18 to 2022-23.
- To avail the benefit, taxpayers must file the required forms on or before March 31, 2025.
- Note: No refunds will be issued for late fees already paid.
2. Late Fee Clarifications
- The waiver applies only to late fees exceeding the amount payable until the filing date of GSTR-9.
- The GST Council clarified that late fees are levied for delays in submitting complete returns for both GSTR-9 and GSTR-9C.
3. Eligibility
- GSTR-9: Mandatory for taxpayers with annual turnover exceeding ₹2 crore.
- GSTR-9C: Mandatory for taxpayers with turnover exceeding ₹5 crore, requiring self-certification.
Impact and Benefits of These Changes
1. Ease of Compliance for Non-Registered Entities
The introduction of a temporary GST identity eliminates compliance hurdles for non-liable entities needing to fulfill tax obligations.
2. Cost Savings for Taxpayers
The late fee waiver incentivizes businesses to complete pending filings without incurring additional costs, ensuring better compliance and reduced financial burdens.
3. Clarity on Late Fee Applicability
The clarification on late fee applicability removes ambiguities for taxpayers, encouraging timely and accurate filing in future years.
Case Law Reference: A Relevant Precedent
The Kerala High Court in M/s XYZ vs. State of Kerala emphasized the importance of enabling non-registered entities to fulfill tax obligations. This aligns with CBIC’s approach to issue TINs, bridging gaps in GST compliance for occasional taxpayers.
Conclusion: Embracing Simplification
CBIC’s recent notifications demonstrate a commitment to improving GST compliance mechanisms. By providing temporary GST identities and waiving late fees, the framework ensures ease of compliance, reduces penalties, and encourages proactive engagement among taxpayers.